Kingstone Companies (NASDAQ:KINS) reported its most profitable quarter on record in the second quarter of 2026, supported by premium growth, underwriting profitability, expense leverage and higher investment income. The insurer said it remains on track with its full-year outlook, while acknowledging that competition is increasing in parts of its markets.
Vice President and Chief Financial Officer Randy Patten said second-quarter net income rose to $15.5 million, or $1.05 per diluted share, from $11.3 million, or $0.78 per diluted share, in the prior-year period. Operating net income increased 41% to $15.3 million, or $1.04 per diluted share. Annualized GAAP return on equity was 50.8% during the quarter.
Premium Growth and Underwriting Results
Direct premiums written increased 19% year over year to $72.5 million, while net premiums earned rose 31% to $60.5 million. Policies in force increased 9.9% to 84,570. Patten said earned-premium growth reflected continued expansion in direct written premiums and a reduced New York quota-share cession.
The company’s New York quota-share cession declined to 5% for the 2026 treaty year from 16% in the prior treaty year, allowing Kingstone to retain a larger portion of premium and underwriting profit.
President and Chief Executive Officer Meryl Golden said growth was led by the company’s New York personal-lines business. New-business policy count increased 35% from the prior-year quarter, retention improved by two percentage points and average renewal premium rose 8%.
Kingstone’s GAAP net combined ratio improved 1.3 points to 70.2%. Its net loss ratio was 39.6%, compared with 38.8% a year earlier, while the underwriting expense ratio improved 2.1 points to 30.6% as earned premiums grew faster than the expense base.
The catastrophe loss ratio was negative 0.8%, as favorable development on first-quarter catastrophe losses exceeded the low level of catastrophe losses recorded in the second quarter. The company also recognized $1.6 million, or 2.7 points, of favorable prior-year reserve development.
Excluding catastrophe losses and prior-year reserve development, the underlying loss ratio was 43.1%, compared with 38.7% in the exceptionally strong prior-year quarter. The underlying combined ratio was 73.7%, versus 71.4% a year earlier.
Golden said the company’s Select products continued to support risk selection. On an inception-to-date basis, Select Homeowners claim frequency was more than 34% below the legacy product, while Select Dwelling Fire frequency was 19% lower. Select represented 62% of homeowner policies in force and 40% of Dwelling Fire policies in force.
Competition and Growth Outlook
Management said it is seeing signs of a softer market and more competitive conditions, especially in the Dwelling Fire line. Golden said Kingstone does not intend to pursue volume at the expense of underwriting standards and expects New York growth to moderate from first-half levels.
“We will not chase volume at the expense of underwriting discipline,” Golden said.
In response to analyst questions, Golden said some new competitors have entered the New York market, while certain existing competitors have loosened underwriting guidelines. She said the company saw a decline in Dwelling Fire new business during July, though she expects competition to have a greater effect on new-business production than renewals.
Kingstone reiterated its full-year 2026 guidance, including:
- Direct premiums written growth of 16% to 20%;
- GAAP net combined ratio of 81% to 86%;
- Underlying combined ratio of 74% to 76%;
- Catastrophe loss ratio of 7% to 10%;
- Diluted net income per share of $2.20 to $2.90; and
- Return on equity of 24% to 30%.
Golden said the company is maintaining its guidance ranges because the most active months of hurricane season remain ahead and competitive conditions are evolving.
Reinsurance and Geographic Expansion
Kingstone increased total catastrophe protection by 14% to $500 million in its July 1 reinsurance placement. The program added wildfire protection and reduced the risk-adjusted cost of core catastrophe excess-of-loss coverage by more than 15%, according to Golden.
The company maintained first-event retentions of $3.5 million for wildfire, $4.75 million for named storms and $6 million for winter storms and severe convective storms. Golden said a storm comparable to Sandy, based on Kingstone’s current footprint, would result in roughly $4.7 million of pretax losses, or about $0.27 per diluted share after tax.
Kingstone began writing business in California during the final week of the quarter through a limited number of agencies. Golden said the company is taking a measured approach as competition in the California excess-and-surplus market has developed faster than anticipated, including renewed activity from some admitted carriers.
The company also expects to enter Connecticut on an admitted basis late in the third quarter, subject to approvals. Golden said New York remains Kingstone’s primary growth and earnings engine, while California and Connecticut represent steps toward geographic diversification. The company’s longer-term goal is to reach $500 million in direct premiums written by the end of 2029.
Capital Position and Shareholder Returns
Net investment income increased 49% to $3.4 million, driven by higher invested assets and an average yield of 4.4%. Total investments stood at $334.1 million as of June 30, up $24.4 million from year-end.
Diluted book value per share reached $8.69, up 35% from $6.44 a year earlier. Kingstone reported no holding-company debt.
During the quarter, the company repurchased about 19,500 shares at an average price of $14.98 per share. Following quarter-end, its board increased the quarterly dividend 20% to $0.06 per share.
Patten said Kingstone’s capital-allocation priorities are to fund growth, increase the quarterly dividend and repurchase shares when opportunities arise. Golden added that management sees an interim opportunity to reduce the expense ratio to approximately 29% as the company scales, while pricing business over time for an 85 combined ratio.
About Kingstone Companies (NASDAQ:KINS)
Kingstone Companies, Inc is a publicly traded property and casualty insurance holding company whose primary focus lies in personal and commercial insurance products. Through its wholly owned subsidiary, Kingstone Insurance Company, the firm underwrites a broad portfolio of property and casualty lines, including private passenger auto, homeowners, inland marine, umbrella, and various small?commercial coverage options. Distribution is handled predominantly through a network of independent agents, allowing Kingstone to maintain strong broker relationships and responsive service for policyholders.
The company was incorporated in Delaware in 2010 and commenced operations following the acquisition of Kingstone Insurance Company in early 2011.
